IEA projects global gas demand rebounding 2% in 2026 on LNG expansion
The IEA's July 2025 Gas Market Report projects global natural gas demand rebounding to 2% growth in 2026 after slowing to 1.3% in 2025, driven by a 7% LNG supply jump. The shifting market structure signals procurement and hedging implications for Indian gas importers navigating transition-fuel reliance.
The International Energy Agency's July 2025 Gas Market Report projects global natural gas demand regaining momentum in 2026 after a 2025 deceleration, driven by expanding liquefied natural gas (LNG) supply. The market remained tight in early 2025 amid persistently low Russian pipeline exports to the EU, slow LNG production growth, and strong European storage injection requirements, lowering global demand growth to 1.3% in 2025 from 2.8% in 2024. Asia-Pacific markets posted the weakest annual consumption growth since the 2022 energy crisis.
Gas importers, utilities, and energy-intensive industries across Asia and Europe are directly affected. Demand is forecast to accelerate to 2% globally in 2026, linked to a 7% LNG supply jump equal to 40 billion cubic metres, the largest annual rise since 2019, with new export terminals in the United States, Canada, and Qatar. European gas consumption grew 6.5% in the first half of 2025 on higher gas-fired power, while China saw a 1% decline and a 20% drop in LNG imports. North America recorded a 2.5% increase.
ESG stakeholders should align procurement and hedging strategies with evolving market structures and geopolitical realities, since natural gas remains central to decarbonisation in the medium term as a transition fuel supporting supply reliability during renewable intermittency. The IEA notes unusually high uncertainty from volatile geopolitical developments and economic variability, plus the Middle East's growing role in global price stability and risk exposure. Stakeholders should monitor new LNG supply timing, which may ease energy-security risks while supporting cleaner-burning fuels toward net-zero targets.
Key figure — 2026 LNG supply rise: 7%, equal to 40 billion cubic metres, largest since 2019
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